Gold Sinks on Possible Debt Ceiling Extension

by Christopher Freeburn | October 10, 2013 4:31 pm

Gold Sinks on Possible Debt Ceiling Extension

[1]An offer from congressional Republicans to temporarily increase the U.S. debt ceiling — postponing the chance of a historic U.S. default — reassured investors Thursday. The U.S. dollar climbed during the day, while gold moved lower on fading safe-haven appeal.

The GOP proposal would give Congress and the White House an additional six weeks to reach a budget agreement without risking the nation’s credit rating and dollar’s status as a reserve currency. The Obama administration said it would consider the deal. Equities markets surged on news of the proposal.

Gold futures for December delivery fell 0.8% to $1,296.90 per ounce on Thursday, according to CME Group[2]. Gold traded as high as $1,312 and as low as $1,293.40. Bullion closed in London at $1,289, according to BullionVault[3].

Silver futures for December delivery rose half a cent to $21.90 per ounce. Thursday’s high for silver was $22.25, while the low was $21.72.

Metal funds pulled back in Thursday trading.

The SPDR Gold Shares (GLD[4]) slid 1.5%.

The iShares Gold Trust (IAU[5]) moved down 1.3%.

The iShares Silver Trust (SLV[6]) dipped 1.1%.

Mining ETFs were declined during the day.

The Market Vectors Gold Miners ETF (GDX[7]) dropped 1.6%.

The Market Vectors Junior Gold Miners ETF (GDXJ[8]) fell 1%.

The Global X Silver Miners ETF (SIL[9]) fell 0.5%.

Gold mining shares mostly sank on Thursday.

Agnico-Eagle Mines (AEM[10]) sank 0.4%.

Barrick Gold (ABX[11]) gained 1%.

Eldorado Gold (EGO[12]) fell 0.8%.

Goldcorp (GG[13]) dropped 1.7%.

Kinross Gold (KGC[14]) moved down 1.3%.

Newmont Mining (NEM[15]) slid 0.8%.

NovaGold Resources (NG[16]) edged lower 0.5%.

Yamana Gold (AUY[17]) tumbled 3.1%.

Silver mining shares were mixed during the day.

Coeur d’Alene Mines (CDE[18]) fell 0.4%.

Hecla Mining (HL[19]) rose 0.3%.

Pan American Silver (PAAS[20]) gained 0.4%.

Silver Wheaton (SLW[21]) dropped 0.9%.

Silver Standard Resources (SSRI[22]) rose 0.2%.

As of this writing, Christopher Freeburn did not hold a position in any of the aforementioned securities. Adrian Ash of BullionVault[23] contributed to this report.